We've been asking ourselves recently if the market has placed a fair valuation on Arcelor Mittal. Let's dive into some of the fundamental values of this Large-Cap Industrials company to determine if there might be an opportunity here for value-minded investors.
Arcelor Mittal Is Potentially Undervalued and Its Shares Are on Sale:
ArcelorMittal S.A., together with its subsidiaries, operates as integrated steel and mining companies in the Americas, Europe, Asia, and Africa. The company belongs to the Industrials sector, which has an average price to earnings (P/E) ratio of 24.03 and an average price to book (P/B) ratio of 2.89. In contrast, Arcelor Mittal has a trailing 12 month P/E ratio of 21.4 and a P/B ratio of 0.5.
Arcelor Mittal has moved 46.4% over the last year compared to 10.6% for the S&P 500 — a difference of 35.8%. Arcelor Mittal has a 52 week high of $34.9 and a 52 week low of $20.52.
A Positive EPS Growth Rate but Slimmer Gross Margins than the Industry Average of 16.75%:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $70,615 | $53,270 | $76,571 | $79,844 | $68,275 | $62,441 |
| Gross Margins | 2% | 8% | 25% | 16% | 7% | 9% |
| Net Margins | -3% | -1% | 20% | 12% | 1% | 2% |
| Net Income (M) | -$2,391 | -$578 | $15,565 | $9,538 | $1,022 | $1,380 |
| Net Interest Expense (M) | $695 | $477 | $357 | $401 | $715 | $510 |
| Depreciation & Amort. (M) | $3,067 | $2,960 | $2,523 | $2,580 | $2,675 | $2,632 |
| Diluted Shares (M) | 1,013 | 1,140 | 1,108 | 914 | 845 | 791 |
| Earnings Per Share | -$2.42 | -$0.64 | $13.49 | $10.18 | $1.09 | $1.69 |
| EPS Growth | n/a | 73.55% | 2207.81% | -24.54% | -89.29% | 55.05% |
| Free Cash Flow (M) | $6,017 | $4,082 | $9,905 | $10,203 | $7,645 | $4,852 |
| Total Debt (M) | $22,942 | $19,630 | $12,976 | $18,134 | $16,738 | $17,630 |
| Net Debt / EBITDA | 7.41 | 2.77 | 0.45 | 0.69 | 1.8 | 1.89 |
| Current Ratio | 1.34 | 1.23 | 1.45 | 1.66 | 1.53 | 1.35 |
